Iowa Democrats announce package of bills to address affordable housing

DES MOINES — Iowa Democratic lawmakers released several bills Thursday that aim to lower housing costs in the state.

Some of the proposals include capping rent increases, creating an affordable housing tax credit program and providing partial refunds for denied rental applications.

At a news conference Thursday, House Minority Leader Rep. Jennifer Konfrst, of Windsor Heights, said the intention behind the legislation is to offer immediate solutions to lowering housing costs while starting conversations around addressing the housing crisis.

“There are ideas big and small within here, but these will all make an immediate impact on people and help address our housing crisis,” Konfrst said. “We are proud to be putting forward legislation that will lower costs for Iowa families. While Republicans continue to ignore the issue of housing and continue to focus on divisive culture war issues, we're here offering solutions.”

Iowa needs roughly an additional 25,000 homes by 2030 to keep up with demand according to the Iowa Finance Authority. In 2023, about 47 percent of Iowans spent more than 30 percent of their income on housing costs.

House Republicans did not immediately reply to a request for comment on Friday.

Senate Democrats also are rolling out some housing program proposals, including a neighborhood housing revitalization assistance program and an increase to the down payment and closing costs assistance grants for first-time homeowners.

“Our goal at this session has been and will continue to be, to provide a better deal for Iowans,” Senate Minority Leader Sen. Janice Weiner, of Iowa City, said during the news conference. “The majority party pushes things like censorship in our public libraries and propaganda in our public schools. Senate Democrats are working to lower costs and make life more affordable.”

What do the plans look like?

One of the three affordable housing-related bills House Democrats are putting forward would focus on rental application fees. House File 266, which was introduced earlier this month, would require landlords refund 50 percent of potential tenants' application fee if their application is denied.

Konfrst said she’s heard from constituents who are spending a lot of money on rental application fees and a 50 percent refund would provide them with a little more financial wiggle room when looking for a place to live.

According to the Iowa Finance Authority, 28.5 percent of Iowa housing units were occupied by renters in 2023.

One bill that Democrats still have yet to file would limit the amount a landlord can increase rent for current tenants in rental units, manufactured home communities or mobile home parks. The legislation would bar landlords from raising rent above the percentage increase of the consumer price index or the percentage increase of property value as determined by the county assessor.

“They don't have predictability,” Konfrst said. “They don't have the ability to understand what their rent will be in six months. We want to help renters have more predictability and also be able to ensure that they can stay in those apartments.”

Another piece of legislation would create a $15 million affordable housing tax credit program, which would provide incentives for developers to build affordable housing units while leveraging federal dollars, Konfrst said.

The legislation would also establish a $50 million neighborhood renovation grant program for current homeowners to make improvements to their homes and create a first-time homebuyer savings account.

In the Iowa Senate, lawmakers have already introduced bills, including Senate File 144, which would incentivize local partners to rehabilitate dilapidated or abandoned properties or create new affordable housing options through land redevelopment trusts and housing trust funds.

Senate File 347 would require the Iowa Finance Authority to establish a neighborhood housing revitalization assistance program, which would include a forgivable loan program to help homeowners renovate and upgrade their homes, Weiner said.

It is unknown how these proposals will fare in the House and Senate, as Republicans hold super majorities both chambers and the governorship.